Prime Minister
Tony Abbott
has urged Indonesian president Susilo Bambang Yudhoyono to “understand" Australia’s hard line on turning back boats, arguing the government will “continue to do what we are entitled to do to secure our borders".

Mr Abbott spoke to reporters at the World Economic Forum in Davos, Switzerland, where he is due to give a keynote speech on Thursday about Australia’s agenda for its presidency of the Group of 20 nations.

The Prime Minister said he hoped the Australian-Indonesian diplomatic relationship had not been damaged by recent revelations that Australian naval boats had entered Indonesian waters during border security operations.

“There have been difficulties in the past. I dare say our two countries being what they are, there will be difficulties in the future. But I do want to stress that President Yudhoyono has been a great president of Indonesia," Mr Abbott said.

“All of that said, for us, stopping the boats is a matter of sovereignty and President Yudhoyono of all people ought to understand, does understand, just how seriously countries take their sovereignty. So we will continue to do what we are entitled to do to secure our borders."

Mr Abbott said he had already met with the chief executives or chairmen of four of Switzerland’s largest companies during his first day at Davos, including natural resources giant Glencore Xstrata and financial services companies UBS, Credit Suisse and Zurich Insurance. He said the companies had been “encouraged" by the government’s record since coming to office in September.

Mr Abbott’s speech on Thursday, his first major test as Prime Minister on the world stage, would contain a “concise description" of what the government wanted to achieve from the G20, he said.

“Importantly, you will get our account of the economic fundamentals that every nation needs to adhere to, and then you will have a degree of specificity about what we are hoping to achieve in this G20 year," Mr Abbott said.

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“I am confident that certainly, by the time of the G20 Leaders’ Meeting in Brisbane in November, I am confident we will also have some very important runs on the board in terms of deregulating and boosting growth back home in Australia."

In separate remarks delivered to a dinner of Australian business representatives, Mr Abbott spoke of the need to balance regulation with private sector risk-taking.

“It’s important to try and repair the leaky tax bases that we all suffer from in government, but we can’t do it in ways which over-regulate the people who we rely upon to produce the wealth that we all need," Mr Abbott said.

“And of course, we have to ensure that our financial system is safe and secure, but we also have to accept that it can’t be so safe and secure that it never takes a risk and this is one of the big challenges we’ve got; trying to ensure that we balance risk and reward, that we balance safety against opportunity, because what we can’t do is wrap the world up in cotton wool, what we can’t do is so regulate things ourselves that no one out there in the creative and producing world feels that they have the ability to take the initiatives that they need."